Published 4:00 am, Saturday, August 23, 2008

Judy Estrin is one of the rare female entrepreneurs of Silicon Valley and the author of a new book on innovation. Photo taken on Friday, August 22, 2008 in her office in Menlo Park.

Judy Estrin is one of the rare female entrepreneurs of Silicon Valley and the author of a new book on innovation. Photo taken on Friday, August 22, 2008 in her office in Menlo Park.

Photo: Norbert Von Der Groeben, Special To The Chronicle

Internet researcher warns innovation lagging

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Just as trees need good soil and climate to create healthy forests, so do startup companies exist within what network industry entrepreneur Judy Estrin calls an innovation ecosystem.

Estrin, an early Internet researcher who once served as chief technology officer for Cisco Systems, has written a book, "Closing the Innovation Gap," in which she warns that the environment for innovation in Silicon Valley and the United States has already changed for the worse.

A short-term outlook and a reliance on quick fixes and fast profits have diluted the curiosity and patience that sustain true innovation and create the potential for future economic growth, she says.

During an interview in her Menlo Park offices, Estrin used an analogy to suggest that Silicon Valley and the United States had a polluted innovation ecosystem.

She cited the iPod as an innovative product that is derived, ultimately, from basic scientific discoveries like the creation of the transistor more than 60 years ago.

Estrin argues that all sorts of forces, from Wall Street's quarterly profit pressures to worsening government deficits, have undermined support for the forward-looking research on which future products will depend.

"What happens to trees is root rot in which the leaves and branches look fine for a while until the tree topples over and dies," she said. "We've already got the root rot."

Estrin studied electrical engineering at Stanford in the mid-1970s when it was a hotbed of development for the computer-to-computer communications technologies that have grown into the Internet.

There she worked under Vinton Cerf, today a Google executive but then the computer scientist who led the development of the networking protocols that became the foundation for the Internet.

In a telephone interview, Cerf recalled the young Estrin as a tenacious worker who, as a junior member of the team, drew the unenviable task of working with computer scientists in London.

"Given the time difference, she would have to come in about 3 o'clock in the morning to have any reasonable overlap with the guys on the other side," Cerf said.

Her early Internet experience propelled Estrin into a series of startups in the vital but unglamorous networking industry - which is the plumbing of the high-tech economy.

In 1981 she co-founded Bridge Communications, which merged into 3Com in 1986. Two years later Estrin helped start Network Computing Devices and became its chief executive in 1993.

In 1995 she co-founded her third startup, Precept Software. It was acquired by Cisco three years later and from 1998 until 2000, Estrin served as Cisco's chief technology officer. Since then she has helped start other lesser-known networking firms. She also serves on the boards of the Walt Disney Co. and FedEx Corp.

"Judy is a rare technologist who has gone from being a lean-forward, make-it-happen entrepreneur to a big-picture make-it-happen board member," said Yogen Dalal, a Mayfield Fund venture capitalist who worked with Cerf and Estrin at Stanford.

Dalal said that as a woman in a business world dominated by men, Estrin "brings a sanity and a style that enables conflicts to be resolved."

In "Closing the Innovation Gap," Estrin recalls how the United States responded to the Russian launch of Sputnik half a century ago with big investments in basic research and bold projects like the Apollo program.

Now she thinks Americans have grown fat off the fruits of these past risks, quit investing for the long term and become addicted to the quick fix.

"People used to be about building companies and creating jobs, but today it's about trading and flipping," she said.

Her suggestion for reform is to focus on four Sputnik-like challenges - creating energy or reducing its use; understanding climate change; improving health care; and improving personal and national security.

Achieving these goals is not just about investing money, she says. It's about understanding the intangible characteristics of the innovation ecosystem, including curiosity, a willingness to take risks, patience and trust that these virtues will be rewarded.

"She interviewed over 160 very important people for this book, movers and shakers," Cerf said, describing Estrin as "passionate without being strident."

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